MADRID - Spanish Prime Minister Mariano Rajoy on Tuesday admitted that it was unlikely his country would see economic growth until 2014.

Speaking on the same day as the economic studies department of Spain's second biggest bank BBVA predicted the Spanish economy would shrink 1.4 percent in 2012 and a further 1.4 percent in 2013 with unemployment passing 26 percent, Rajoy said that growth would return to his country in 2014.

Speaking on radio station Cadena Cope, Rajoy tried to put a positive spin on his country's economic situation.

Spain's Prime Minister Mariano Rajoy reacts during a session at the senate in Madrid, Nov 6, 2012. [Photo/Agencies]

"This has been a bad year, but we have laid the basis for the recovery. 2013 will be better than 2012, but we will not see any clear economic growth until 2014," he said, defending his government's policy of fiscal austerity.

"There are things that cannot be solved by magic and it will need time to see the effects of our reforms," he said, adding that in 2012 "somewhat less" than 600,000 jobs would be destroyed, despite the latest unemployment figures published on Monday which showed over 128,000 Spaniards lost their jobs in October and that the total number of people out of work in the country is now 4,833,521.

The prime minister said it would probably be unnecessary to raise taxes and dropped a hint that when the economy began to recover, his government would look into the possibility of lowering the fiscal pressure on its citizens.

"There are measures that we did not like having to take and we will overturn some of them in 2014," insisted Rajoy, adding that unless a possible European Union bailout would significantly lower the costs of financing his country's debt that such a measure had "very little sense."

"We have to stop having such a large debt. That is the road: if there is no credit there is no investment and no employment," assured Rajoy.